Consumer Connection: Avoid Scams and Fraud by Talking With Family Over the Holidays

By Sonya Sellmeyer, Consumer Advocacy Officer for the Iowa Insurance Division.

This holiday season, Iowans will gather with loved ones. It's a great time to discuss some tips about financial fraud which can help prevent those you care about from becoming victims. 

Scammers target our elder population due to their accumulated wealth, age, and isolation. Various studies show elders lose between $2.9 billion to $36 billion a year from financial fraud.  Financial exploitation can take place in many different ways, including charity scams or even scams involving the sale of products such as life and health insurance, annuities, and other investments. 

When purchasing an insurance or investment product, it's important to always double-check to make sure both the person selling the insurance or investment product and the product itself are properly licensed. Much of the fraud seen by the Iowa Insurance Division is due to unlicensed sales.  The Iowa Insurance Division recommends asking a few simple questions to protect your family members from becoming a victim.

• What is your financial plan?  Having a financial plan, and sticking to it, makes a person less likely to be a victim of fraud.  Adult children, or another trusted individual, should be aware of their parents’ financial plan in case of a mental or health decline.  Having a buddy system with aging parents protects everyone and allows elder adults to maintain their independence, while adding a layer of protection against scammers.
  
  
• What financial products do you own?  Make sure the elders in your life know and understand their financial products and how they work.  It’s important for consumers to know where their financial products are held, and to check their statements regularly for accuracy.
    
• What if you are approached by someone soliciting a financial product?  Unsolicited financial offers may come from a knock at the door, a phone call, mail, electronic mail or social media.   Unsolicited pitches are rarely in your best interest. Slow down, ask questions, do further research, and double-check to make sure the person selling an insurance or investment product is properly licensed or registered by calling the Iowa Insurance Division at 877-955-1212.  It's a good idea to get a second opinion.
  
  
• Do you understand the insurance or investment product you want to purchase? The policy or investment should fit within your financial plan and goals.  The product you are purchasing should be appropriate or suitable for you and your financial situation.  Also, do not be persuaded by a “must act now” pitch. Remember that if something sounds too good to be true it is.

Show you care by discussing these issues with your family members this holiday season.  If your loved ones need further guidance, the Iowa Insurance Division is here to help. Ensuring elder Iowans aren’t alone when making decisions in this very serious area is one of the best gifts you can provide your loved ones this holiday season.

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